With billionaire investor Carl Icahn reportedly sniffing around J.C. Penney (NYSE: JCP), the company would dearly love to report solid fourth-quarter numbers on Thursday, to show that corporate raiders aren't the only ones who know a little bit about shareholder value.

But with comparable-store sales declining over the past two months, including a whopping 7.5% slide during the critical month of December, that may be a tall order for the department-store operator.

What analysts say
Consensus analyst estimates call for $1.77 in earnings per share, down 11.5% from last year's fourth quarter. That's at the high end of a wide range of $1.65-$1.80 that the company suggested in early February. But given that J.C. Penney has beaten analyst estimates by an average of $0.02 a share for the past four quarters, I can understand why the analyst community is wearing rose-colored glasses.

Seventeen analysts follow the company, serving up an average buy recommendation of 2.3 on a scale of 1.0 (strong buy) to 5.0 (strong sell). That's a more favorable view than the two stars (out of five) awarded the stock by the Motley Fool CAPS community.

What the company says
Management has been somewhat tight-lipped the past few months -- understandable, given the soft sales trends. Last November, CEO Myron E. (Mike) Ullman noted that sales weakened "dramatically" after a solid back-to-school season, and offered up that J.C. Penney was not immune to the challenging consumer environment.

What one Fool says
J.C. Penney knocked the cover off the ball during 2005 and 2006, delivering solid comp-store sales increases and 180 basis points of margin expansion, leading both earnings per share and the stock price to double.

These results were best-in-class when compared to other department-store operators like Macy's (NYSE: M), Dillard's (NYSE: DDS), and Saks (NYSE: SKS). Solid earnings growth from discounters like Wal-Mart (NYSE: WMT) and Target (NYSE: TGT) pales in comparison.

It's not clear at this point how big a stake Carl Icahn has accumulated, nor whether he will agitate for more leverage or sales of real estate to buy back stock. One thing is clear: J.C. Penney's stock is 46% off its high of $87 a year ago, and it's starting to look a bit cheap. Just how cheap, we'll learn later this week.

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Wal-Mart is a Motley Fool Inside Value selection.

Fool contributor Timothy M. Otte surveys the retail scene from Dallas. He welcomes comments on his articles. Tim owns shares of Wal-Mart, but none of the other companies mentioned in this article. The Fool has a disclosure policy.